The physical chip design aspects of a 16-bit, single-chip, custom-macro-designed microprocessor are described. This microprocessor represents the IBM System Products Division's highest-density VLSI FET processor design to date. The chip is a complex arrangement of over 6500 VLSI circuits utilizing a state-of-the-art polysilicon-gate HMOS-1 (high-performance MOS) technology. The physical design of this chip required the use of a comprehensive methodology, from conception through completion. The methodology used in the design of the microprocessor was based on a hierarchical approach and is presented in this paper.